Press Digest: Penang may lose 'Silicon Valley of the East' position

PETALING JAYA: Penang may lose its position as the Silicon Valley of the East following news of relocations, mergers, retrenchment and even plant closures involving nine major foreign electronic players in the state.
According to a report in Nanyang Siang Pau today, the series of moves, despite earlier reports of injections of tens of millions of ringgit in investment by two Chinese entities in six months, will affect more than 1,000 employees.
It is understood that the nine in the news are Motorola, which had been acquired earlier; Western Digital; famed German stereo system maker Blaupunkt; HGST; Amphenol TCS; EMC; UTi; Erriccson; and AMD.
An industry source said those which will close their Penang plants are United States-based firms Western Digital, which is relocating to the Klang Valley; HGST, which is shifting to Johor Baru; and Amphenol TCS, which is relocating one of its three manufacturing facilities to China.
Meanwhile, the acquisitions involved Motorola by US electronics manufacturing services provider Sanmina Corp; EMC by Dell, UTi by DSV and Ericsson by Flextronics, an American company headquartered in Singapore.
Sanmina Corp, Dell and UTi are all based in the US while DSV is a Danish firm and Ericsson has its headquarters in Stockholm, Sweden.
The report said while AMD has signed an agreement with China's Nantong Fujitu Microelectronics to set up a joint venture company, Blaupunkl Malaysia, which has more than 300 employees, is winding up its operations in Penang.
The source said it is not known if more news of plant relocations or closures are to come but what is certain is that the latest moves in Penang's electronics and electrical industry will affect more than 1,000 employees including engineers.